Education, From The Capitol To The Classroom

Stories about students: How does education policy affect the way students learn and grow? Can schools meet their needs as they balance ramped-up testing with personal changes and busy schedules? And are students who need help getting it?

Stories about educators: How are those responsible for implementing education policy in schools − from classroom teachers, to district administrators, to school board members − affected by changes at the top? And how well do they meet their challenge of reaching students with varying abilities and needs?

Stories about school assessment: With an increased push for 'accountability' in schools, what can test scores tell us about teacher effectiveness and student learning − and what can't they tell us? What does the data say about how schools at all levels are performing?

Stories about government influence: Who are the people and groups most instrumental in crafting education policy? What are their priorities and agendas? And how do they work together when they disagree?

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Stories about money: How do local, state, and federal governments pay to support the education policies they craft? How do direct costs of going to school − from textbooks to tuition − hit a parent or student's bottom line? And how do changing budgets and funding formulas affect learning and teaching?

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[The report] confirmed what many of us have believed — that there is a huge danger to the economy by runaway student lending in the last decade.

In 2001, lenders handed out less than $5 billion in private student loans in the U.S. By 2008, that had swollen to more than $20 billion, as lenders began marketing and disbursing the loans directly to student borrowers.

Between 2005 and 2007, the CFPB says the percentage of undergraduate student loans made without the involvement of the school jumped from 40% to 70%.

“As a result, many students borrowed more than they needed to finance their education,” writes the CFPB. “Additionally, during this period, lenders were more likely to originate loans to borrowers with lower credit scores than they had previously been. These trends made private student loans riskier for consumers.”

As a result of the increased lending and as the broader economy stumbled, the report continues, student loan defaults shot up. By 2009, more than $200 million-worth of the loans made in 2008 had already fallen into default.

“Starting in 2008… banks and investors incurred sharply increased defaults on loans made during the lending boom,” the report found. “The timing of these defaults appears to track the recession.”

As we wrote in May, troubling trends in the student lending market are causing a lot of hand-wringing among those watching the broader economy.

“If one is not thinking about where this is headed over the next two or three years, you are just completely missing the warning signs,” Rajeev V. Date, deputy director of the Consumer Financial Protection Bureau, told The New York Times.

However, as we also noted, others believe the problems of the student lending market are likely to self-correct — and despite the risks of college loans, higher education is still worth it for most people.

If you’re having trouble paying down your student loans, the Consumer Financial Protection Bureau offers a few resources here.